INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 25(2), PROTECTION OF EMPLOYEES (TEMPORARY AGENCY WORK) ACT, 2012
TEAM OBAIR LIMITED
- AND -
MR ROBERT COSTELLO
(REPRESENTED BY SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION)
Chairman: Mr Duffy
Employer Member: Ms Doyle
Worker Member: Ms Ni Mhurchu
1. An appeal against a Rights Commissioner’s Decision r-127463-taw-12/SR.
2. The Employee appealed the Rights Commissioner’s Decision dated 30th July 2013 to the Labour Court in accordance with Section 25(2) of the Protection of Employees (Temporary Agency Work) Act 2012 on the 28th August 2013. The Court heard the appeal on the 31st October 2013.
The following is the Determination of the Court:
This is an appeal by Mr Robert Costello (represented by SIPTU) against the Decision of a Rights Commissioner in his claim against his employer, Team Obair Limited. The claim is taken under the Protection of Employees (Temporary Agency Work) Act 2012 (the Act).
In this Determination Mr Costello is referred to as the Claimant and Team Obair Limited is referred to as the Respondent.
The Respondent is an employment agency. The Claimant is employed by the Respondent as a forklift truck driver. His basic pay is €13.50 per hour. He is assigned by the Respondent to a third party, namely Logistics Company Shannon Transport Logistics (STL), hereafter referred to as the ‘hirer’.
The Union contends that the Claimant is being paid less in terms of basic pay to that which he would have been paid had he been employed directly by the hirer to perform the same work. The claim is made in reliance on s.6(1) of the Act.
The Court was told that the Claimant is one of a number of agency workers employed by the Respondent each of who are pursuing similar claims based on similar facts. It appears that in the case before the Rights Commissioner it was decided that the within claim should proceed first and that the other claims would be considered in light of the findings in the instant case.
The Rights Commissioner found that the claim was not well-founded. The Claimant appealed to the Court.
The material facts of the case are not in dispute and can be summarised as follows: -
The Claimant is employed at a plant operated by Diageo Guinness Ireland Limited at St James Gate Dublin. The work in which he is engaged was historically undertaken by workers directly employed by that company. As a result of restructuring by Diageo Guinness Ireland Limited this work was contracted out to third party undertakings during the 1990s. The contracts for the provision of this service were awarded by way of tender. Various third parties were awarded the contract through this process in the intervening years.
The Respondent was contracted to provide agency workers to the original third party contractors and on each occasion on which the contract passed from one contractor to another the Respondent retained the business of providing agency workers to the incoming contractor. It appears that on each occasion on which the contract changed the employees of the outgoing contractor were transferred to the incoming contractor pursuant to S.I. No. 131/2003 - European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003.
The Claimant was employed by the Respondent in or about March 2007. He has been continuously employed at the plant at which he now works since that time. He was originally assigned to an entity that preceded the hirer as contractor at the St James Gate site. It appears that the hirer obtained the contract in or about January 2012 and the Respondent continued to provide the services of the Claimant to the hirer. The hirer employs a number of workers who are engaged in work that is identical in all material respects to that performed by the Claimant.
The employees of the hirer are members of SIPTU and it appears that the hirer recognises the SIPTU for industrial relations purposes, including collective bargaining.
Position of the Parties
The rates of pay applicable to employees of the Respondent, including the Claimant, are €11.50 for general operative work and €13.50 for driving fork lift trucks. SIPTU contends that employees of the hirer who are engaged in identical work are paid €740 per week for a 40 hour week, or €18.50 per hour. The Union nominated a number of employees of the hirer as comparators and it produced pay statements furnished to those comparators in verification of its contention in that regard. It contends that had the Claimant been employed directly by the hirer on or after the date on which s.6 of the Act came into effect he would have been paid at the aforementioned rate.
The Respondent told the Court that when it commenced the contract it obtained a statement in writing from the hirer, pursuant to s.15 of the Act, setting out the basic terms and conditions that it would apply if it employed workers directly on the same work as that undertaken by agency workers assigned to it by the Respondent. In that statement the hirer indicated that it would pay fork lift workers the same rate as that paid to the Claimant by the Respondent.
The Respondent further pointed out that the comparators nominated by the Claimant were all employed prior to the coming into effect of s.6 of the Act on 5thDecember 2011. On that account the Respondent contends that they cannot be relied upon as valid comparators for the purposes of the within claim. It was further pointed out that the named individuals have service ranging from 18 years to 9 years. The Respondent argued that this is an additional factor which rendered the comparison with those employees invalid for the purposes of the Act. There is, however, no suggestion that the rates paid to those individuals is in any way service related.
Conclusions of the Court
This Act was signed into law on 16thMay 2012. Its purpose is to transpose in Irish law Directive 2008/104/EC of the European Union on Temporary Agency Work. Consequently the Court is obliged to interpret and apply the Act, as far as possible, in light of the wording and purpose of the Directive so as to achieve the result envisaged by the Directive. The Act commenced on 16thMay 2012, although sections 2, 3, 4, 5, and 6 are deemed to have commenced on 5thDecember 2011, the date on which Members States were employed to implement the Directive.
The purpose of the Directive is set out at Article 2 thereof as follows: -
- The purpose of this Directive is to ensure the protection of temporary agency workers and to improve the quality of temporary agency work by ensuring that the principle of equal treatment, as set out in Article 5, is applied to temporary agency workers, and by recognising temporary work agencies as employers, while taking into account the need to establish a suitable framework for the use of temporary agency work with a view to contributing effectively to the creation of jobs and to the development of flexible forms of working.
- The principle of equal treatment
1.The basic working and employment conditions of temporary agency workers shall be, for the duration of their assignment at a user undertaking, at least those that would apply if they had been recruited directly by that undertaking to occupy the same job.
- 6.— (1) Subject to any collective agreement for the time being standing approved undersection 8, an agency worker shall, for the duration of his or her assignment with a hirer, be entitled to the same basic working and employment conditions as the basic working and employment conditions to which he or she would be entitled if he or she were employed by the hirer under a contract of employment to do work that is the same as, or similar to, the work that he or she is required to do during that assignment.
- (3) Where the assignment of an agency worker commenced before 5 December 2011 and ended or ends on or after that date, that assignment shall, for the purpose of determining the agency worker’s basic working and employment conditions in accordance with subsection (1), be deemed to have commenced on that date.
The meaning to be ascribed to the term ‘basic working and employment conditions’ is set out at s.2 of the Act as follows: -
- “basic working and employment conditions” means terms and conditions of employment required to be included in a contract of employment by virtue of any enactment or collective agreement, or any arrangement that applies generally in respect of employees, or any class of employees, of a hire, and that relate to—
- (a) pay,
(b) working time,
(c) rest periods,
(d) rest breaks during the working day,
(e) night work,
(g) annual leave, or
(h) public holidays;
- (a) pay,
- (a) basic pay, and
(b) any pay in excess of basic pay in respect of—
(i) shift work,
(ii) piece work,
(iv) unsocial hours worked, or
(v) hours worked on a Sunday,
There will be little difficulty in practice in identifying conditions of employment derived from an enactment or a collective agreement. But the term “any arrangement”is less certain. It seems that the use of this term was intended to give s.6 of the Act a wide ambit so as to encompass conditions of employment established within a hirer by systems used for that purpose in employments where collective bargaining does not take place. It can also include less formal arrangements stablished by custom and practice. However the term connotes an objectivemodus operandifor determining conditions of employment rather than a subjective assessment of individuals.
In this case the rates paid by the hirer are not formally prescribed in a collective agreement. According to the Union they are determined by an arrangement established by custom and practice whereby rates are carried forward and modified from time to time by collective bargaining. The Respondent did not take issue with the Union’s contention in that regard.
As appears from s.6 and Article 5 of the Directive an agency worker is entitled to the same basic employment conditions as those to which he or she would be entitled if employed by the hirer. That raises a question as to what employment conditions the agency worker would have become entitled to under any enactment, collective agreement, or any arrangement of general application to similar workers if he or she had been employed by the hirer at the time his or her assignment commenced (or is deemed to have commenced under s.6(3) of the Act). That question involves an element of hypothesis but it must be grounded on reliable evidence rather than by mere speculation or assertion.
Unlike other similar employment rights statutes the Act does not require a claim for equal pay to be grounded by reference to an actual comparator. Nevertheless, the rate that is paid to employees of the hirer who are engaged in the same type of work is an important evidential tool. Where a rate of pay is generally applicable to all workers performing the same work as that performed by the agency worker it may readily be inferred that if the agency worker was employed by the hirer he or she would be similarly paid. However, it may be that the relevant rate paid by the hirer is in whole or in part attributable to factors that do not apply to the agency worker. Or it may be that rates generally applied by the hirer have or would have changed since the rate relied upon was established. In such eventualities the Court could reasonably infer that had the agency worker been employed by the hirer at the time the assignment commenced (or was deemed to have commenced) he or she would have been paid a different rate of pay than that claimed.
However, these are questions of fact that can only be established on reliable evidence, which in most cases, will be within the peculiar knowledge or power of procurement of the Respondent and beyond a Claimant’s capacity of proof. Hence, it would appear that the onus of proving that a rate of pay established within the hirer employment would not have applied to an agency worker had he or she been directly employed by the hirer rests with the party making that assertion.
Application to this case
In this case the only evidence relied upon by the Respondent is apro formdocument used by the hirer for the purpose of providing information to the Respondent pursuant to s.15 of the Act. This section provides: -
- (1)It shall be the duty of the hirer of an agency worker to provide the employment agency that employs that agency worker with all such information in the possession of the hirer as the employment agency reasonably requires to enable the employment agency to comply with its obligations under this Act in relation to the agency worker.
The provider of this information did not give evidence. It is, however, undisputed that the hirer does not employ any workers on those rates at the St James Gate facility and there is no evidence that it applied them elsewhere. It was suggested by the Respondent that the rates specified are those that the hirer would pay if it now employed workers to perform the same work as that undertaken by the Claimant. The Union pointed out that rates upon which it relies are established within the hirer and it did not agree, nor would it agree, to any reduction of those rates for new entrants.
Conclusion of the Court
The points raised in this case are novel and are not governed by any authority of which the Court is aware. Accordingly they must be approached by the application of first principles.
There are rates of pay for fork lift drivers within the hirer which are established by an arrangement of long standing. While this is acknowledged by the Respondent it contended that those rates are historical. It submitted that if the hirer took on new employees at the time that the Claimant’s assignment is deemed to have commenced the rates payable would be those specified in the s.15 notification upon which it relies. That, however, is a mere assertion which cannot be elevated to an evidential basis upon which the Court could make findings of fact. In particular, the Respondent has not pointed to any pay determination arrangement operated by the hirer the application of which might result in fork lift drivers being paid €13.50 per hour.
There are other factors which undermine the validity of the submission advanced by the Respondent. The rates specified in the notice furnished by the hirer are precisely those paid by the Respondent. It is at least probable that the information furnished by the hirer is predicated on the assumption that if the Respondent can employ labour on those rates it could do likewise. If a bare statement based on such a premise were to be accepted as definitive the purpose of the Act, and that of the Directive, would be seriously subverted and the protection which they are intended to provide would be rendered nugatory. Moreover, the principle of non-regression (which is a general principle of European Law) and which is reflected in Article 9.2 of the Directive, operates so as to preclude an employer from reducing the level of protection afforded to directly employed workers as a mode of compliance with the Directive and the Act.
There is a further consideration of some significance in this case. The Court is aware from its own knowledge and experience that there would be potential for serious industrial relations conflict if an employer, in the circumstances of the hirer, were to employ workers on significantly different rates of pay to perform the same work. The hirer recognises SIPTU for industrial relations purposes, including collective bargaining. It is inherently unlikely that it would or could seek to reduce established rates of pay without some level of engagement with the Union. There has been no such engagement and according to the Union there would be little or no chance of it agreeing to accept rates for employees of the hirer in line with those currently paid by the Respondent.
For these reasons, and in the absence of any reliable evidence to the contrary, the Court has come to the conclusion that it is more probable than not that had the Claimant been employed by the hirer on 5thDecember 2011 he would have been paid €18.50 in line with other fork lift drivers similarly employed. Accordingly, that is the rate to which he is entitled pursuant to s.6(1) of the Act. Accordingly the Court must hold that the Claimant is entitled to succeed in this appeal.
The mode of redress that may be ordered by a Rights Commissioner, and by extension by this Court, is set out at Paragraph 1(3) of Schedule 2 of the Act. It provides: -
- A decision of a rights commissioner under subparagraph (2) shall do one or more of the following, namely—
- (a) declare that the complaint was or, as the case may be, was not well founded,
(b) require the employer to take a specified course of action (including reinstatement or reengagement of the employee in circumstances where the employee was dismissed by the employer), or
(c) require the employer to pay to the employee compensation of such amount (if any) as is just and equitable having regard to all the circumstances but not exceeding 2 years remuneration in respect of the employee’s employment,
- (a) declare that the complaint was or, as the case may be, was not well founded,
In accordance with Clauses (a) and (b) of subparagraph (3) above, the Court declares that the Claimant’s complaint is well founded and it directs the Respondent herein to adjust the Claimant’s rate of pay to €740 per 40 hour week, or €18.50 per hour, with effect from 5thDecember 2011.
The Decision of the Rights Commissioner is set aside and substituted with the terms of this Determination
Signed on behalf of the Labour Court
7th November, 2013.Chairman
Enquiries concerning this Determination should be addressed to Ciaran Roche, Court Secretary.